IDC's rebuttal IDC has responded to the IDC for positive change. I look forward to AA response to this.
International Datacasting Corporation (TSX:IDC) ("IDC" or the "Company") responded today to certain statements in the dissident proxy circular filed by Mr. Adam Adamou in connection with the Company's upcoming meeting of shareholders to be held on July 31, 2012. The current directors (other than Mr. Adamou) and management of IDC wish to correct certain misinformation and omissions in Mr. Adamou's circular:
-- Mr. Adamou's circular states that his business acquisition strategy ("BAQ") was "short-lived" and implies that the strategy was in effect for two months only, from July 12, 2011 to September 7, 2011. This is factually incorrect. IDC pursued Mr. Adamou's BAQ strategy, without success, from December 2010 through to and including June 2012. -- Mr. Adamou's circular fails to disclose the costs of the business acquisition strategy to IDC. Under Adam's leadership, the BAQ strategy has cost IDC a total of $871,658. $239,597 of this amount, including $18,750 in fees to Mr. Adamou, was incurred in the current quarter. -- This $239,597 cost, which will significantly affect IDC's earnings in the current quarter ending on July 31, 2012, was incurred in negotiating a transaction that was sourced and principally negotiated by Mr. Adamou under the auspices of the BAQ. This transaction ultimately failed as it was rejected by the other party. During the course of the BAQ, several other transactions were considered by Mr. Adamou's Investment Committee, but were not put forward to the full Board for consideration. -- Mr. Adamou was in fact terminated as Executive Chairman of IDC, in part as a result of his record of execution on the BAQ. As an accommodation to Mr. Adamou, he was permitted to resign his employment instead. -- Mr. Adamou's circular states that his director nominees are aligned with his strategy. In fact, Jim Hall, one of Mr. Adamou's nominees, supported Mr. Adamou's termination as Executive Chairman, was one of the lead proponents of de-emphasizing the BAQ, and resigned as a director of IDC immediately before being called upon to vote on the transaction that ultimately failed. -- Mr. Adamou's circular fails to identify a principal occupation for either Mr. Adamou or his nominee Robert Mimeault, as required under applicable securities laws. IDC's information is that neither Mr. Adamou nor Mr. Mimeault currently have a principal occupation. We note that Mr. Adamou's circular calls for IDC to "hire experts to execute" his acquisition strategy. We ask that Mr. Adamou publicly state his intentions about assuming a senior executive position at IDC, or otherwise causing IDC to retain his services or the services of Mr. Mimeault, should his slate prove to be successful in the upcoming election. For the record, over the two year period ending July 31, 2012, the direct cost to IDC of Mr. Adamou's involvement has been $632,061, which includes his salary, severance, hotel and food costs while in Ottawa and other ancillary costs associated with the BAQ. This is separate from the $18,750 in fees Mr. Adamou earned related to the above noted failed transaction. The potential benefits of the BAQ should be weighed against the direct and indirect costs to IDC. -- Mr. Adamou's circular does not clearly state that most of his IDC shares were acquired with a $552,000 shareholder loan from IDC. Mr. Adamou is the only current director, officer or employee of IDC who has received the benefit of a share purchase loan. IDC's Board has the ability to call Mr. Adamou's shareholder loan 90 days after he ceases to be a director. Del Lippert, one of the directors of IDC, stated "Regardless of which side prevails in this election, the current Board and management feel that it is important that the facts of the BAQ, Mr. Adamou's plans and the costs to the Company are understood. The shareholders of IDC deserve to make an informed decision."
IDC also wishes to address confusion caused by Mr. Adamou's proxy solicitation campaign. Mr. Adamou's use of IDC's name, logo and customer brand in his social media campaign are unauthorized. IDC has invested in its logo and branding to support its digital content distribution business, and the logo and branding should only be used for that purpose. Shareholders are also advised that on July 9, 2012, Mr. Adamou made an unauthorized filing on SEDAR under IDC's profile, which has now been removed by the Ontario Securities Commission.